Brand Strategy Case Study “Virgin Inc” by solehin251

VIEWS: 9,029 PAGES: 11

More Info
									Brand Strategy Case Study
“Virgin Inc”



Virgin’s first and most obvious distinctive brand resource is Richard Branson and the ‘Virgin People’ that make up the organization. Richard Branson’s charismatic style and entrepreneurial flair is an asset that other organizations are unable to replicate, and it is his personality that is synonymous with the Virgin Brand and that makes the company unique.

Richard Branson’s personality is synonymous with Virgin’s strong branding & reputation. Virgin has been able to sustain the Virgin identity across multiple businesses in a way that that very few other corporations have, and the pervasiveness of the Virgin brand creates unique brand equity that is difficult for competitors to replicate.


2.0 BRAND-NAME STRATEGY Brand- name strategy is the manner in which a supplier of a service or good uses the brand name or brand mark in communicating product and service attributes. Strategies may incorporate company name plus product

identification, product name alone, company name plus product name or product line name plus product identification.

Branding enables a buyer or costumer to develop loyalty and carry out repeat purchases. A brand also identifies the organization behind the product or service, thus guaranteeing a consistent quality or satisfaction. A brand product offers the opportunity to aggressively stimulate demand for the product. To the costumer, a branded product enables him or her to single out the product, which a particular seller is offering. He learns to trust and to accept it based on experience with it. To be meaningfully advertised and differentiated, branded merchandise approach seems a possible way out.


Virgin is a classic example of a company that uses a mono brand strategy. All Virgin products or services at cover a wide range of industries-from Travel and Tourism (Limousines, Vacations, etc.), Leisure and Pleasure (i.e. Spa, Games, etc.), Social and Environment (i.e. Green Fund, Virgin Earth), Beverages (i.e. wines and soft drinks), Media and

Telecommunications (i.e. Radio, Broadband, Mobile, etc), Books, Clothing, Finance and Money, and Health (i.e. Health Bank, Life Care). But despite its diversification in terms of industries and products, it never diversified its brand names. All of its services and products in every industry have the name Virgin affixed to it. For instance, they have Virgin Brides, Virgin Atlantic, Virgin Music, Virgin Cola, Virgin Spa, Virgin Money, Virgin Life Care and many more.

There are two offers at which can be categorized as convenience goods and unsought goods. First is Virgin Books. Convenience goods can be defined as consumer goods which the customer usually purchases frequently, immediately and with the minimum of effort. The Virgin Books category encompasses a wide range of book titles from fiction to non-fiction with bargain prices and easy online payment.


Second offer is Virgin Galactic. As it offers out of the world experience of extra-terrestrial transportation, the service can be defined as unsought goods. Unsought good is one that a consumer does not know about or knows about but does not normally think of buying. New products, such as space travel and space tourism are unsought until the costumers learn about them through word-of-mouth influence or advertising. In addition, the need for unsought goods may not seem urgent to the costumer.

So why would Virgin choose to highlight these types of products? We have to understand that the corporate strategy of the Virgin Group is to operate like ‘a venture capital firm based on the Virgin brand.’ This strategy involves non-related diversification at the individual business unit level. Meanwhile, synergies are created from hierarchical relationships and the interaction of the corporate head office with individual business units. By leveraging on the Virgin brand which has established prominence in the minds of consumers, Virgin is able to enter new business areas with a bang and shake up existing orders. The unique Virgin culture also allows Virgin to break into new markets and execute its ventures very effectively.


Virgin shows that a brand’s longevity and strength has to be built less on price and more on differentiation. In markets cluttered with messages, and where a certain level of quality of product and/or service is expected by customers, brand owners have to find ever new ways to foster loyalty. Consider how Branson has managed to stretch the Virgin brand into areas far beyond his original musical activities.

Virgin brand conveyed a sense of youth, quality, innovation and fun to young people across the globe. Virgin isn't a company, it's a brand. Virgin’s brand-strategy is best described in the Virgin Charter; the individual businesses are focused and develop as autonomous enterprises under a single unified brand name.

At the same time, the individual businesses benefit from the world-wide, inter-industrial reputation of the parent corporation’s Virgin brand and are able utilize this brand recognition in their marketing efforts. This benefit of corporate parenting would not be available to them if they were operating under their own subsidiary brands, and is perhaps the greatest source of synergy within the Virgin Group. In this manner, Virgin is able to enjoy the benefits of both smaller entrepreneurial organizations and large conglomerates without the associated problems of bureaucracy and brand conflict that can often feature in diversified corporations.


Furthermore, Virgin has been able to deal with the potential downsides of autonomy and decentralization. To prevent the breakdown of communication links and individual business units pursuing their own strategies in an uncoordinated fashion that could potentially be detrimental to the umbrella Virgin brand, the Virgin Charter sets out a management system and internet business strategy that takes advantage of information technology and the digital age to further establish the Virgin brand. With a single web address been established, is a place where costumers can go to have access to all the Virgin services under a single portal. This strategy helps to reinforce the corporate parenting strategy and enhance the synergies already derived from the corporate branding of the Virgin Group.

By aggregating all the services into a single Virgin portal, the consumer is able to access multiple services through a single distribution channel, and is enticed to turn into a ‘Virgin Customer’ where he comes to Virgin for his telecommunications, banking, terrestrial and extra-terrestrial transportation (Virgin Galactic), entertainment and internet service needs. In this way, the disparate Virgin businesses are able to gain from the successes from their corporate siblings, Virgin Rail gains customers referred from Virgin Mobile visiting the portal, while Virgin Money gains customers referred from Virgin Records, and so on.


In comparison, competitor banking companies would hardly dream of marketing their services to a music crowd, while competitor railway companies would be hard pressed to market to mobile customers of an unrelated company. Even though the individual business units are in unrelated fields, the unified corporate strategy in Virgin Group allows them to contribute to each other in a synergistic manner.


3.0 CONCLUSION Establishing a unique identity in today's marketplace is a challenge, particularly in the competitive consumer business world. How can Virgin stand out among the bevy of local and national companies vying for business in the market? While service and results long have been paramount to gaining and keeping clients, a well-known brand also helps bring business through the door.

But branding is not just about edging out the competition. Effective branding makes Virgin stand out, but more importantly, it ensures to be remembered. Establishing a successful brand involves more than having a catchy brand name, it requires hard work and a good strategy. The payoff of a company's

efforts may be a strong customer base that is not easily enticed by competitor's products. The success of Virgin brand-name hinges upon the corporate parenting strategy which is led by founder Richard Branson. The sustainability of Virgin’s competitive advantage depends on how well it continues to retain the Virgin brand-name and execute the strategy of decentralization under a unified branding.


Today, more companies are using creative methods to build their brands and establish their identities in the marketplace. Though their strategies may differ, the ultimate goal for all companies is to ensure that their brands create the right perceptions in customer' and prospective customer ' minds. While no one approach fits all, one principle holds true: "Your brand is your promise of value. It's the way to distinguish yourself in your industry”.










Advertising. Copenhagen: CBS Press

Roger A Kerin, Steven W. Hartley, Wiliam Redulius. (1998). Marketing: The Core. NY: Mc Graw Hill

Charles W. Lamb, Carl D. McDaniel, Joseph F. Hair. (2006). Marketing. NH: Thomson South Western

Kenneth B. Kahn. (1999). Product Planning Essentials. NY: Sage,





at,com_glossary/func,view/Itemid ,28/catid,13/term,convenience+goods/. Retrieved on 19 March 2008

Virgin Group.Com at Retrieved on 21 March 2008


To top